Eni Lifts Dividend After Years of Cuts
March 16 2018 - 9:19AM
Dow Jones News
By Sarah Kent
LONDON -- Italy's state-back oil giant Eni SpA is raising its
dividend, in a fresh sign that the international energy industry is
bouncing back from a three-year downturn.
Eni said Friday it plans to raise its dividend by nearly 4% from
last year. The company will also consider share buybacks, depending
on its cash flow position over the next four years, it said.
The company's announcement follows a flurry of promises from big
oil companies to improve shareholders' rewards through a mix of
share buybacks, higher dividends and a return to pure cash payouts.
Last month, Norway's Statoil ASA also announced plans to increase
its dividend. Elsewhere, BP PLC is restarting share buybacks, while
Royal Dutch Shell PLC has returned to a full cash dividend
policy.
Eni's response to the oil-price crash of 2014 was the most
austere among the majors. The company slashed its dividend 29% in
2015, under intense pressure from prices that had fallen below $50
a barrel and eventually slid to less than $28 a barrel.
It was a radical move in an industry where shareholder payouts
are taken as sacred.
Other big oil companies went to great lengths to protect their
dividend, accepting rising debt levels, suspending share buybacks
and offering payouts in shares rather than cash.
Eni's plan to begin raising its dividend policy reflects the
fragile confidence creeping back into the industry after years of
cost cutting. Oil prices have risen in the past year, briefly
breaching $70 a barrel in January before falling back down to about
$65 a barrel for Brent crude, the international oil benchmark.
"The dividend increase we announced today is a result of the
business and financial improvement achieved so far, as well as our
confidence in further growth," Chief Executive Claudio Descalzi
told analysts in London.
(END) Dow Jones Newswires
March 16, 2018 09:04 ET (13:04 GMT)
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